Commentary: What merchants want from mobile commerce

Nov. 13, 2012

By Dodd Roberts of MCX and the former head of the Merchant Advisory G

After years of promise, it appears mobile commerce is finally on the verge of an explosion. Forrester Research estimates that mobile payments will hit $31 billion by 2016, up from $6 billion last year. As a result of this anticipated growth, merchants are becoming increasingly serious about mobile commerce and continue to scrutinize the various offerings from banks, issuers, carriers, technology giants and, of course, their fellow merchants.

The Merchant Customer Exchange (MCX), a newly-formed coalition of more than 20 leading merchants, is leveraging technology to create a mobile-commerce solution that will best serve the needs of customers and merchants alike. The promise of this solution has generated momentum for MCX and interest in the group from many other merchants.

In fact, earlier this month, Gap Inc., Dillard's Inc., Dunkin' Brands and Bed Bath & Beyond Inc. joined a group that already included top-10 retailers such as Walmart, Target, CVS, Lowe's and Best Buy.

So why are so many merchants lining up to commit to MCX?

First, merchants know that mobile commerce will only gain traction when customers are able to use a single platform at the various places they already shop every day. The current mobile-payment landscape is growing in a way that will leave customers guessing which mobile wallet works with which phone at which store. The market will take off once a customer can pump gas, buy groceries, dine out, pick up a prescription and go to the mall while paying the same way at all of those locations. MCX's collection of major national and regional merchants –which will be joined by smaller merchants as well—will make that a reality.

Second, MCX's model would keep transaction data where merchants believe it belongs: between the merchant and its customers. Mobile commerce brings with it the potential to enrich the relationship between customers and merchants more than ever before, using transaction data to craft relevant and personalized offers that are pushed directly to a customer's mobile device before, during and/or after a store or web visit. Most of the major emerging offerings, however, are attempting to circumvent this relationship, wresting away transaction data for offers. This data, if shared with a merchant's direct competitors, can help those competitors target the very same customers a merchant is trying to keep.

Lastly, the MCX merchants share a belief that mobile commerce should improve a payments system that is rife with inefficiencies that result in unnecessary costs for all stakeholders. Yet most of the current mobile-commerce options not only leave these costs in place but also have the potential to layer new costs on top of them, both for merchants and issuers.

MCX intends to help change the payments status quo with a secure, customer-focused mobile platform that has a common set of standards. MCX's solution may not be on the market yet, but once it is, it will quickly be accepted at a broad array of retailers processing more than $1 trillion in payments annually. No other solution can say that.

We believe merchants should remain in control, and through MCX, they will gain access to the only mobile-commerce platform designed to reduce unnecessary costs in the payments system, keep merchants' customer data securely with merchants and give their customers a better shopping experience.